Site Navigation

Site Mobile Navigation

Fewer Perks and More Work for Wall St.’s Summer Interns

By Kevin Roose July 21, 2011 8:36 pmJuly 21, 2011 8:36 pm

Minh Uong

Wall Street interns have gone from pampered to pummeled.

In better days, college-age interns at the nation’s largest investment banks, known as summer analysts, were treated like young royalty. But shrinking profits and a spate of recent bank layoffs have forced this year’s interns to shoulder full-time workloads.

“I worked 85 hours last week!” said one Goldman Sachs summer analyst, a college senior who spoke on the condition of anonymity because she was not allowed to speak to the media.

“The last two days, I’ve been here until 3 a.m.,” said a Deutsche Bank analyst, who also spoke on the condition of anonymity to protect his job. “My weekends are fun, but that’s about it.”

While hard work has been customary among young finance workers for years, after-hours benefits once made the long days more palatable. In 2006, a group of JPMorgan Chase interns took a firm-sponsored trip in white Hummer limousines to the trendy NoHo nightclub Butter, where they partied before retiring to swank rooms at the Hudson Hotel, according to a person who was present. The next year Lehman Brothers took interns to Jones Beach for a concert featuring OK Go and the Fray, and Credit Suisse paid for its interns to take gourmet cooking classes, according to former interns at the banks.

Those extravagances are gone, experts say, victims of slashed entertainment budgets and increased sensitivity at banks whose reputations suffered during the financial crisis.

Many summer analysts at large New York banks were issued smartphones, laptops, and corporate charge cards upon arriving in mid-June. They were assigned to divisions within the bank, and some were placed on desk rotations aimed at exposing them to different parts of the firm. Many interns attended a several-day workshop led by a specialized firm such as Training The Street or Adkins Matchett & Toy, where they were taught accounting basics, Excel shortcuts and the fundamentals of corporate valuation.

Then the real work began. Analysts in the investment banking divisions of banks are said to have the longest hours, with many staying at their desks well past midnight to tweak pitch books or adjust spreadsheets.

“They are effectively treated just like analysts and associates,” said Scott Rostan, the founder of Training The Street, a firm that leads workshops for new finance workers.

Unexpected turbulence in the industry has hit this year’s interns, who say that fewer full-time employees has meant more work for them. UBS and Credit Suisse have both conducted layoffs this year, and Goldman Sachs and Morgan Stanley are cutting back as well.

“Managing directors are telling interns, ‘We’re going to need you to step up,’ ” said one bank recruiter, who spoke only anonymously because she was not authorized to speak to the media.

Anticipating an uptick in deal activity, some banks assembled larger intern classes this year. JPMorgan Chase, for example, increased its intern class to 1,500 from 1,250 positions nationwide, according to a company spokesman. And demand at top-flight colleges for the internships, which had tailed off slightly during the financial crisis, has come roaring back.

“It’s the best way to land a permanent position, it’s prestigious, and there’s a steep learning curve, so you come away having been quickly trained and assigned meaningful work,” said Patricia Rose, director of career services at the University of Pennsylvania.

For their long hours, Wall Street interns are rewarded handsomely. Summer analysts are generally paid based on the prorated salary of a first-year analyst. At Goldman Sachs, for example, a first-year analyst’s salary of $70,000 translates to a summer intern’s pay of about $15,000 for 10 weeks of work, which includes a $2,000 housing stipend, according to one current intern. Interns at the Manhattan offices of BlackRock, the asset management firm, are paid a prorated salary that comes out to around $33 an hour, with time and a half for overtime exceeding 40 hours a week, according to a company spokeswoman.

But for most interns, the real prize is an end-of-summer job offer. Investment banks stock their full-time ranks with former interns, and the pressure to create loyalty during a 10-week summer is palpable. This year, Goldman Sachs summer analysts are being addressed by executives such as David A. Viniar, the firm’s chief financial officer, and Gary D. Cohn, the firm’s president. The Goldman intern reported nervously sharing a silent elevator ride with Lloyd C. Blankfein, the firm’s chief executive.

“It’s a delicate dance,” Mr. Robinson said. “The banks are assessing them, and these kids are assessing what the banks are doing.”

Even in a 10-week summer, interns can stand out. Earlier this year, Sunjay Gorawara, an Indiana University student who is interning at JPMorgan Chase’s investment bank this summer, won the stock-picking contest at the annual Ira Sohn investing conference. Mr. Gorawara’s speech, an appraisal of the for-profit education company Bridgepoint Education, brought him to the attention of industry heavyweights, including the hedge fund manager Steve Eisman.

But there is also potential for costly mistakes. This summer, some young Morgan Stanley employees were disciplined for rowdy behavior and noise complaints at Mercedes House, a Midtown apartment building where the firm houses many of its young employees. No interns were involved, but one full-time analyst was fired, according to a person with knowledge of the incident. A Morgan Stanley spokeswoman declined to comment.

For interns who survive the summer, the payoff can be big. Top performers are often given offers in the fall for full-time positions that begin the following summer, freeing them from the stress of a senior-year job search.

And even for interns who don’t plan on returning full time next summer, like the overworked Deutsche Bank summer analyst, a Wall Street internship may be good preparation for the trials of working life.

“If I can get through this, I can get through anything,” the intern said.